The fact that solar was still competitive with the most efficient gas technology after adding battery storage, which bumps up the cost by 126 percent, was “quite big news,” said Rory McCarthy, senior storage analyst for Wood Mackenzie Power & Renewables.

The firm’s latest figures show the levelized cost of energy (LCOE) for solar-plus-storage ranging between around $60 and $100 per megawatt-hour across five Middle East and African countries: Egypt, Jordan, Morocco, South Africa and United Arab Emirates (UEA).

This puts the combination of solar and batteries on level footing today with CCGTs in Morocco, which have a fuel cost of $6.90 to $9 per million Btu, and starting this year in Jordan, where the fuel cost is from $5.60 to $6.80 per mmBtu. In Egypt, for comparison, the gas price to the power sector is currently $3 per mmBtu.

"For gas-poor countries like Morrocco and Jordan, solar-plus-storage will be driven by the need to reduce reliance on expensive gas imports," the report states.

By 2023, Wood Mackenzie predicts that the cost premium for storage will have dropped to 85 percent and solar LCOEs will have come down, too.

In South Africa, the most expensive market surveyed, Wood Mackenzie expects solar LCOEs to go from $41.70 per megawatt-hour today down to $32.90 in 2023. And in the UAE, the lowest-cost market for solar among those surveyed, PV LCOEs are forecast to drop from $25.70 to $20 per megawatt-hour.

These cost reductions mean that by 2023 the LCOEs of PV with batteries will have fallen to between $40 and $60 per megawatt-hour, beating CCGTs in all of the countries surveyed except for Egypt. Egyptian solar-plus-storage will remain unable to compete with CCGTs because of the low cost of gas in the country, which is expected to be a net gas exporter between now and 2023.

And while PV and batteries are expected to reach cost competitiveness in four of the five spotlight countries, analysts say it's unlikely that demand will spike, due largely to the duration limits of energy storage. The Wood Mackenzie report modelled PV coupled with four hours of lithium-ion battery storage.

For comparison, the authors also looked at the competitiveness of concentrated solar power (CSP) plus thermal storage in Morocco, South Africa and the UAE.

The report noted CSP thermal stores were typically designed for long-duration discharge applications, with up to 15 hours of storage. “If tenders are designed for long-duration storage, lithium-ion projects may find it difficult to scale and compete at this level,” it said.

“However, if tenders are modeled based on a technology-neutral approach, solar-plus-storage could compete and win on an LCOE basis after the expected cost reductions have come to fruition for four-hour systems.”

McCarthy noted that in pitting solar-plus storage against CCGTs the analyst team was not intending to carry out an apples-to-apples comparison, since the gas turbines are designed for baseload operation. Instead, the aim of the study was to chart how far solar-plus-storage had come in terms of competitiveness in the Middle East and Africa.

“CCGTs are arguably the most efficient fossil-fuel plants out there,” McCarthy said.

Still, the report shows that solar-plus-storage, which was a very expensive combination until recently, "is beating the most cost-effective fossil-fuel plants in areas where fossil fuels are among the cheapest in the world," he said. "Five years ago, you would have been called crazy to say this was on the cards in 2019.”

It remains to be seen whether Middle East and African policymakers will take note, though.

Although appetite for PV is booming, with capacity expected to almost double this year, only 147 megawatts of front-of-the-meter storage has so far been commissioned or contracted across the whole of the Middle East and Africa, according to Wood Mackenzie. Around 38 megawatts of this is made up of co-located PV and battery storage.

“It’s unlikely that solar-plus-storage will see the same growth pattern in the region as standalone PV, as many of the market fundamentals are yet to be introduced," the report states. “But in markets that will face grid-balancing issues from high-penetration renewables or are in the process of phasing out gas subsidies, it is likely that PV projects will increasingly co-site battery storage where grid services are valued.”

The new Interreg NWE project Ocean DEMO has been officially launched today. It provides funding to developers of marine renewable technologies to test their products or services in real sea environments. Ocean DEMO specifically targets multi-machine ocean energy installations. This will allow developers to move closer to market by demonstrating their technologies at full commercial scale. Ocean DEMO will release a first call for applications this year and devices will be installed from 2020 to 2022.

New York Governor Andrew Cuomo (D) has announced his Green New Deal is included in the 2019 Executive Budget. The plan provides for a transition to clean energy that will help spur the growth of the green economy while prioritizing the needs of low- to moderate-income New Yorkers.

Global clean energy investment reached a total of $332.1 billion in 2018, down 8 percent on 2017, although it was the fifth year in a row in which investment exceeded the $300 billion mark, according to Bloomberg New Energy Finance (BNEF).

The New Jersey Board of Public Utilities (BPU) has approved rules for a new community solar pilot programme that will give many renters, low-income families, businesses, and others an easy and affordable way to go solar for the first time.

The last time Pacific Gas & Electric declared bankruptcy, in 2001, its customers paid billions of dollars in higher rates while company creditors and shareholders lost little. In that case, PG&E’s losses were largely due to deregulation and marketplace manipulations by Enron and others.

The California utility's current financial woes are a result of its own negligence. Given the dramatic changes that have occurred in the electricity sector in the last decade, the public should come first this time.

Two major shifts have already triggered a transformation of the electricity system in California, and across the country.

First, millions of former PG&E customers now get their electricity from a community-owned power agency. Enacted in the years following the Enron debacle, California’s community choice policy allowed municipalities to take charge of their own energy procurement. These local agencies better reflect local interests, including renewable energy, local power generation, and a desire to align power generation with local economic development.

By the end of 2018, nearly one-quarter of the state’s three investor-owned utility retail customers had switched to their community supplier. The state’s Public Utilities Commission estimates that more than three-quarters of utility customers could leave its service by 2030.

Second, hundreds of thousands of PG&E customers now produce their own electricity from solar on their own property. Across the state, 750,000 customers have installed solar to reduce their electricity costs, taking advantage of power production that doesn’t require extensive transmission (hardware that has proven a big liability to the utility).

Cumulatively, these solar installations can — at noon on a sunny day — produce as much electricity as two nuclear power plants. And with inexpensive batteries already being paired with on-site solar installations, the power of electricity customers to be self-reliant will continue to grow.

The last bankruptcy was a fix for a policy-driven problem: botched deregulation of energy markets that allowed unscrupulous energy marketers like Enron to scam utilities by faking electricity shortages. The solution was targeted — make the utilities solvent again, and repair the market. A narrow and incremental fix doesn’t exist for this bankruptcy threat; now, the cause is systemic.

PG&E has a legal liability to ensure maximum value for shareholders. That gives utility executives an institutional bias toward building big, expensive infrastructure that generates shareholder returns but is vulnerable to climate-accelerated threats like wildfires (or widespread customer-owned power generation). The fix for PG&E’s financial crisis will fail unless it addresses the utility’s bias toward deploying vulnerable infrastructure.

Some states, like New York, have tried to shift utility culture toward decentralized and distributed solutions to electricity system needs, but it’s about as easy as turning the Titanic. And when utilities have historically earned a 10 percent return (or higher) on capital for building big things, it’s likely to cost even more to incent them to invest in small things.

California has already deployed viable alternatives. Community choice energy programs and customer-owned power generation have already made big contributions to carbon-free power generation, without the perverse incentive to focus on big infrastructure.

Publicly-owned utilities in Missouri, Texas and Vermont have already deployed 100 percent renewable electricity systems. Sacramento’s municipal utility famously and democratically shuttered a costly nuclear plant, pioneered rooftop solar programs nearly twenty years ago, and has committed to ambitious renewable energy deployment. And industry reliability data shows that the public power system tends to have better reliability, in large part because public owners don’t shortsightedly scrimp on maintenance for better quarterly returns.

Instead of investing billions in building and maintaining vulnerable transmission infrastructure, a publicly-owned PG&E could, as a grid manager, focus on the electricity system democratization already in progress. It could invest in local infrastructure that supports rooftop solar and batteries, managed electric vehicle charging, and smart grid tools to allow customers to use clean power when it’s most available and least expensive.

Upton Sinclar famously said, “It is difficult to get a man to understand something, when his salary depends on his not understanding it.” As long as PG&E has a legal obligation to its shareholders to build big and vulnerable, utility executives are unlikely to start understanding the financial folly of the company’s business model. Maybe it’s best that they don’t have to anymore.

***

John Farrell is the energy director at the Institute for Local Self-Reliance.

Massachusetts is considering doubling its solicitations of offshore wind to 3.2GW. The first round of solicitations for 1.6GW of offshore wind is already under way, meaning the new goal could add a further 1.6GW by 2035, Windpower Monthly confirmed.

New Hampshire may soon join the handful of New England states actively pursuing offshore wind energy development.

On January 2, Governor Chris Sununu sent a letter to Walter Cruickshank, the acting director of the Bureau of Ocean Energy Management (BOEM), requesting that the agency establish an intergovernmental offshore renewable energy task force. The move is the first step in a multiyear process.

“The task force will mirror those in other states,” said Matthew Mailloux, an energy advisor with New Hampshire’s Office of Strategic Initiatives, in an email.

“Its purpose is to facilitate coordination with federal and New Hampshire stakeholders to determine the feasibility of offshore wind in federal waters off New Hampshire’s coast. This is a preliminary step in a lengthy process prior to any decision,” he said.

A group of lawmakers from the New Hampshire State Senate and House of Representatives filed a joint resolution for the 2019 legislative session “supporting efforts to develop wind power off the New Hampshire coast” and urging Gov. Sununu to ask BOEM to create the offshore wind task force.

The resolution noted that New Hampshire has committed to reduce greenhouse gas emissions by 80 percent by 2050 but “has yet to develop a plan to achieve that goal.”

BOEM is closed as a result of the partial U.S. federal government shutdown, so New Hampshire officials will have to wait before receiving a response from BOEM. The shutdown has already delayed two public meetings for the Vineyard Wind project planned for offshore Massachusetts, as GTM previously reported.

The opportunity in New Hampshire

Will Gov. Sununu’s letter to BOEM prompt project developers’ interest in New Hampshire?

“This was actually kind of a surprise, to see the governor requesting that this task force be formed,” Francis Pullaro, executive director of the non-profit RENEW Northeast, told Greentech Media in an interview.

“The industry has very much been focused on the southern New England states because there’s the existing leases and recently completed lease action,” he said. “But there’s no reason all the coastal states in New England can’t take advantage of this technology.”

Project developers active in the north Atlantic region have thus far focused their attention on states such as Massachusetts, New York, and New Jersey that have announced ambitious offshore wind deployment targets.

The record-breaking auction conducted by BOEM last month for lease areas offshore Massachusetts, New Hampshire’s neighbor to the south, was no doubt a wake-up call for New Hampshire officials.

That’s not to say that state policymakers are unaware of New Hampshire’s offshore wind potential. A 10-year state energy strategy released in September 2014 estimated the offshore wind resource potential in New Hampshire at nearly 3,500 megawatts.

The state lawmakers’ joint resolution cited a 2015 bipartisan New Hampshire legislative study committee report, which concluded that "the wind resource off of New Hampshire’s coast has the potential to generate significant amounts of electricity" and "offshore wind development has the potential to generate significant economic activity within Portsmouth Harbor."

Pullaro observed that Portsmouth is no stranger to wind energy development, as components for onshore wind projects built in Northern New England have been shipped through the deep-water port.

Regional cooperation on offshore wind development

Because New Hampshire does not have a large electric load, there is the potential, said Pullaro, for electricity generated at offshore wind projects to be sold in Massachusetts, Connecticut, or even New York.

“For these projects to really make sense,” he said, “the New England states need to work together – particularly the northern New England states that don’t have a lot of electric demand.”

Offshore wind projects need to be built at scale in order to be cost effective. That's why it's important for New Hampshire to join forces with its neighbors, while recognizing that they’re going to want to pursue their own interests and local economic development, according to Pullaro.

"To get scale for the off-taker agreements,” he said, “they really need to work with the other New England states.”

After a period of moderation, heat trapping gases are going up in the U.S. and around the world. In 2018, global emissions rose by 2.7 percent. And U.S. emissions rose by 3.4 percent, according to an early tally from the Rhodium Group.

This week, we're going to put some meaning to those emissions numbers. We are joined by Brad Plumer, an energy and environment reporter at the New York Times, who will help us dig into each sector.

We will answer the following questions:

Why aren't wind and solar making up for coal closures?

Which sectors are becoming the worst emitters?

Will the "Trump bump" accelerate the emissions trend in the medium term?

If we were king/dictator/wizard for a day, what sector would we address first?

Don't forget to give The Interchange a rating and creative review on Apple podcasts for your chance to win a yearly subscription to GTM Squared!

Support for this podcast comes from Wunder Capital. Wunder Capital is the leading commercial solar financing company in the United States. Click here to find out how Wunder Capital can help you finance your next commercial solar project.

Annual increases of the amount of imported steel exempted from European Union (EU) tariffs will push up the price of wind and put 2030 renewable energy targets at risk, trade association WindEurope has claimed.

With the mayor’s signing of the Clean Energy D.C. Omnibus Act of 2018, Washington, D.C., has officially committed to transition to 100% renewable electricity by 2032.

Today, Mayor Muriel Bowser signed the historic legislation, bolstering her Clean Energy DC plan, which includes 57 action items for how the district will reach the clean energy target, including raising the solar carve-out to 10% by 2041 and establishing a task force charged with forming building energy performance standards.

In addition to the requirement for electric utilities to source their supply from 100% renewable sources, the bill also does as follows:

Increases fees on energy from sources including coal and gas and uses the revenue to fund energy efficiency and renewable energy programs;

Sets up one of the nation’s strongest energy performance standards for existing buildings to maximize energy efficiency; and

The signing event was held at the newly renovated American Geophysical Union headquarters, the first-ever net-zero energy renovation in the district.

According to the Sierra Club, Washington, D.C., joins the states of California and Hawaii, as well as 104 municipalities across the U.S., to formally establish a 100% renewable energy goal. In addition, Bowser has previously pledged to make D.C. carbon-neutral by 2050.

“D.C.’s energy and climate action plan calls for 50 percent greenhouse-gas reductions by 2032,” states Mark Rodeffer, chair of the Sierra Club’s D.C. Chapter. “The law signed by Mayor Bowser today puts us on a path to meet that goal or even surpass it. We applaud Mayor Bowser’s climate leadership, which includes not only signing this law but also pledging that D.C. will be carbon-neutral by 2050.”

This target means that all municipal operations, residences and businesses within D.C. will be powered entirely by renewable sources – including the White House. The Sierra Club’s D.C. Chapter worked with the D.C. Climate Coalition to gain support for the measure, which was approved unanimously by the Washington D.C. Council last month. The coalition gathered over 10,000 petition signatures over the course of a three-year campaign.

“Councilmember Mary Cheh and the rest of the D.C. Council were instrumental in setting the nation’s capital on a path away from fossil fuels,” continues Rodeffer. “We look forward to working with the Bowser administration to implement this strong law.”

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